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Analytics, 31 December 2022

General Market Outlook as 2023 Approaches

As we come to the end of the year, it is in the best interest of any investor to know the current outlook of the market as we come to the beginning of 2023. After the tough and stressful occurrences of 2022 from post-pandemic struggles and the Russia-Ukraine geo-political conflict to the current recession predictions, it is time to enter the new year with what we have learnt so far.

Doug Porter, the chief economist at BMO Financial Group had this advice to give “Given what has happened over the past 12 months we all have to be prepared for a significant surprise again, whether it’s from inflation or Fed policy. We have to be brave in thinking about the possibilities.”

Indeed, it may look like 2023 is not going to be easy to maneuver through some stock to bring hope into the New Year. In this article we shall have a look at what is going on in the market as we approach 2023.

U.S Market Outlook

Craig Erlam, a senior market analyst at OANDA had this to say on the U.S market, “Investors are going into 2023 with a cautious mindset, prepared for more rate hikes, and expecting recessions around the globe. The bar is low but arguably reasonably so.”

At this time when all facts seem to point to an imminent recession, investors may be unsure where to begin in 2023. Here are some of the stocks that took over the headlines in the U.S: Tesla: There is no way of mentioning stocks hitting headlines today without mentioning Tesla. After the twitter takeover and the subsequent tweet from Elon Musk, Tesla’s market environment seems to be finally calming down. Only time will tell how the stock will do in 2023. Southwest Airlines: After some management issues caused a lot of flight cancellations, Southwest Airlines stock fell by more than 10% but recovered a bit of ground on Thursday by rising 3.7%. Shaw Communications: Canada’s competition watchdog made a move to block Rogers Communication from taking over Shaw Communications. The Canadian Competition tribunal dismissed this move and gave a go ahead for the 26 billion dollar deal. Shaw surged 10.1% in the premarket, while Rogers gained 0.4%.

Asia Market Outlook

The global forecast for the Asian markets is not at its best due to the worries over the general look of the world economy and the outlook for interest rates. The European stocks were mixed and the U.S. stocks were down and the Asian markets tried to follow the latter lead.

Here are some of the main headlines in the market this month: It appears Tesla is about to withdraw its production from China and is now giving tempting offers to those of its potential customers who will import their products directly from the U.S.

China’s financial futures and stock exchanges said on Friday they would cut or waive some fees in 2023, to lower the cost of trading for market participants.

In India, the Covid-19 pandemic and the recovery problems that followed plus the gains on reopening are history. The economy is now losing momentum, although the market continues to be unpredictable. Even with some caution from investors due to high inflation and a global slowdown. The consensus expectation is for earnings to rise by 18% over the next 12 months. Banks are the best choice for optimizing because they are benefiting from higher business volume and superior pricing.

Australian Market Outlook

During the global market hits we had to take and experienced in the past 12 months, Australian shares found refuge in its mining firms’ stocks which gave investors very lucrative gains. The stocks end the year as one of the most enticing stocks in the region.

Oil prices appear to have fallen overnight as West Texas Intermediate crude oil prices go down by 0.7% while Brent crude oil also falls by 1.1%. Australian based energy producers like Beach Energy Limited and woodside energy group may end the week and year on a sour note.

Investor’s Note

The U.S has never had a year that ended this badly since 2008. the U.S stocks fell on friday which was the last trading day for 2022. However, amid fears of a recession, high interest rates and high inflation there is possible growth potential to be found on the other side of 2023.

China may ease travel restrictions this january. this may help the country through the current cautiousness by investors. This comes after 3 years of no protocols taken against the pandemic opening up China’s market more.

In general, all stocks are dealing with the problems created by this year’s ups and downs, but there is hope for a better year provided we use the knowledge gained from this stressful year.

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